1. None appeared on behalf of the appellant. By letter dated 30.1.2008, the appellant requested to decide the case on merits in their absence on the basis of the submission.
2. Heard the ld. DR on behalf of the Revenue and perused the records.
The appellants are providing the services under the category of "Consulting Engineer Service". They obtained registration in the year 1997. During the period 1st April, 2005 to 30.9.2005, the appellant failed to deposit the tax within the stipulated period. The adjudicating authority appropriated the tax of Rs. 14,550/- as deposited by them before the issue of show cause notice by TR-6 Challan dated 21.1.2006 and also imposed penalty of equal amount under Section 78 of the Finance Act, 1994. He dropped the penalty under Section 76 and 77 of the said Act in exercise with his power under Section 80 of the Finance Act, 1994. The Commissioner (Appeals) upheld the adjudication order but reduced the penalty of 25% of duty amount as the tax was deposited before issue of the show cause notice. Thereafter, the Commissioner of Central Excise revised the adjudication order and imposed penalty under Section 76 and 77.
3. It is seen from the adjudication order that the appellant's accountant was part time employee and had been entrusted the work of Service Tax deposit and filing the returns of Service Tax, who had withdrawn the total amount of Service Tax and interest thereon of Rs. 13,855 on 2.10.2005 for deposit in the Bank. So, they presumed and had bona fide belief that the Service Tax amount had been deposited by the Accountant in time. It was stated that the Accountant had left the service without any information to them. Thereafter, they were informed by the Central Excise Officers that the Accountant had not deposited the tax. Accordingly, the appellant immediately deposited the tax. The adjudicating authority after considering the bona fide of the appellants waived the penalty under Section 76 and 77 of the Act in exercise of the powers of Section 80 of the Act. The Hon'ble Karnataka High Court in the case of Commissioner of Central Excise, Bangalore v.Samita Sethi reported in 2006 (3) STR 404 held that the adjudicating authority had exercised the powers conferred on him under Section 80 of the Act having regard to the facts and circumstances of the case and revision of such order is not justified. In the present case, I find that the adjudicating authority, after considering the facts and circumstances of the case as stated above, waived the imposition of penalty under Section 76 and 77 in exercise of the powers under Section 80. The Commissioner in the revision order had not disputed the facts and circumstances of the case as narrated in the adjudication order.
Therefore, I do not find any justification to impose penalty under Section 76 and 77 of the Act. The impugned order of the Commissioner is not sustainable and it is set aside. The appeal is allowed.